Union Minister of State for Finance Jayant Sinha today said the A P Shah Committee’s recommendation to grant relief to FIIs on Minimum Alternate Tax (MAT) will be a positive for the market.
“The Shah report in fact has come out. I believe they have said the Minimum Alternate Tax (for the period before April 1, 2015) issue should be resolved quickly, which I think will be positive for the market…,” he told reporters at the launch of ‘Innofest’ at the Indian Institute of Science here.
The panel, headed by Law Commission Chairman A P Shah, was set up to resolve the dispute between FIIs and the government after notices were served to 68 FIIs by the Income Tax Department demanding Rs 602 crore as MAT dues.
The notices were served to these FIIs after the Authority for Advance Rulings (AAR) in 2012 had directed Castleton to pay MAT in India on its book profits when the company transferred shares from a Mauritius entity to one in Singapore.
The issue at hand is whether the government would waive MAT prior to April.
Sinha is optimistic that the growth is going to continue in India in spite of the current global volatility because “there are many other positives” in global and Indian economies.
“(Market) tends to see volatility because of the growth slowdown in China and Fed looking to raise rates – obviously there is a time of turbulence, but of course, overall, there are many other positives in the global economy and certainly (as far as) India is concerned, there are a number of positives. So, I am sure the growth is going to continue in India,” he said.
To a specific query on strict disclosures as far as P-Notes are concerned, Sinha said the government is looking at it to ensure the markets are transparent.
“The government is looking at P-Notes to ensure our markets are transparent — that we have good KYC as to who is investing through P-Notes,” he said.
“Sebi is seized of the matter… but the government would do things in a balanced way taking into consideration all stakeholders’ interest.”
To another poser, Sinha said the government is trying to create a venture capital (VC) industry to make it possible for domestic venture capitalists to fund Indian innovations.
Sinha said the government is also working on ‘Atal Innovation Mission’ which will encourage creating a network of innovation labs.
“Through Atal Innovation Mission, we can create a network of innovation labs as well as CVs of grand challenges to tackle and work on India’s problems,” the Minister said.
The government through Sebi is trying to encourage companies to list in India for tapping capital markets here.
“The third thing the government has already done… is to encourage companies to list in India and go and tap capital markets here,” he said.
Efforts are also on to get small companies started very quickly and efficiently, Sinha let out.
“The fourth thing which we are doing is really around easing business and making possible to get small companies started very quickly, very efficiently, and these small companies can then try to solve problems, grow businesses and do well for themselves,” he said.